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In the middle of the 1980s, my family made the move to Newmarket, Ontario. I was born in Kapuskasing and tough times at the mill resulted in a decline in the population and less opportunity to earn a living. The GTA was growing and Newmarket was a small quiet town to raise a family. It was far enough from the city but close to its amenities. Interest rates were slowly coming down from a peak of 21% and a house could be purchased for less than $100,000 in town. In 1984 the town of Newmarket was much different. Green Lane and Mulock were dirt roads. Big box stores did not exist. Leslie Valley, Glenway, Bristol Rd, Summerhill, Stonehaven and College Manor would come later. In 1981 the population was 29,753. By 2011 the population had grown to 79,978 and is probably around 90,000 today. Places to Grow will require us to increase to over 100,000 in the future despite being out of land. Along with the population growth, the housing market has increased to record highs while interest rates have fallen to record lows. Today the same neighborhood my parents purchased for less than $100,000 in 1984 will cost you $600,000-$700,000. It would be difficult to find a place in Stonehaven under $1,000,000. That is obviously much higher than the inflation rate and growth in wages over the last 30 years after inflation. 52% of GTA workers are precariously employed and the average salary in Ontario today is about $49,000. Many households are spending a high percentage of their income on shelter and could be at risk if interest rates increase or if we continue to see the same increases in property taxes, hydro and general cost of living expenses. It seems to be promoted as a good thing when we see housing prices went up 19%. The problem is that the increase is not real unless you actually sell. Otherwise like the stock market it is value on paper. For those that sell at peak, they also have to buy at peak assuming they want to stay in the GTA. Those who get in at peak are taking a risk. Those who get out at peak will be proven smartest. The demand for housing exceeds supply currently and the result is bidding wars, sale prices above asking, huge year over year increases in value and deals in the Toronto and Vancouver areas that just seem ridiculous when reported in the news.

The population of Newmarket seems to be made up of four groups. Seniors who have lived in town most of their lives or who have family close by. Baby boomers who have raised their family and are close to retirement or retired living in the same home for years. Young families who grew up here or paid less for a home in exchange for further distance from Toronto. New Canadians and residents who have located in the GTA including Newmarket during times of recent rapid growth. York Region is currently the fastest growing region in Canada. The Toronto and Vancouver housing markets are no doubt being driven by rapid growth and the fact that most of the job creation is happening in these two cities and their suburbs within Canada. The growth that Newmarket and municipalities closer to Toronto saw during the 1990s has now moved North to Georgina, EG, Bradford, Alliston, Innisfil and Simcoe County as the areas closer to the city fill up or is protected for environmental reasons. Increasingly in the 905 politicians are promoting urban pedestrian communities while most of their population wants the family home and car lifestyle. This past weekend I was surprised to see the scale of development happening in Sharon, Holland Landing and the St. Johns Sideroad area of Aurora. In Toronto where the demand for condos exist, there seems to be a crane on every corner building a new condo. Intensification is happening in the 905 as well with new condos and rentals in areas that were once small towns surrounded by fields. People continue to come to the GTA and from what I see massive development projects are happening in Halton, Peel, York, Durham and Simcoe. The growth will continue as long as the red hot housing market exists in this area. A strong demand remains in the GTA for housing, especially affordable housing.

The GTA will eventually see a conflict in priorities among generations. For many in my parents generation, the asset of their home is an important part of their retirement plan and they will soon be looking to cash out by downsizing or relocating to an area with perhaps a lake and nature close to home where housing prices are lower. Some will be interested in purchasing or renting condos where less property maintenance is required. Long term care facilities will no doubt expand in town as demand increases because of the aging population. Some will want to flee the GTA for Florida, Muskoka or Friday Harbour. Many younger Canadians will want to sell their Toronto condo or move out of their parents basement to raise a family in the town they grew up in. Some of these people have gotten in with the help of the Bank of Mom and Dad. Younger people often have student debt, paid for a wedding and have not spent as much time in the workforce to save up large sums of money. Many are underemployed despite being the most education generation in history. The suburban dream is to raise a family in a purchased home. Banks, mortgage agents and real estate agents seem to be bending over backwards to make the impossible possible. Millennials feel pressure to scramble for a down payment and borrow a ridiculous some of money at record low interest rates eating up most of their income in the process. Our economy has become dependent on real estate. Many tied to the industry continue to peddle the belief that the housing market will always increase. To see the same return as my parents from the housing market over 30 years, would mean a house in Stonehaven will be worth over $7,000,000 in 2045. There is always talk of missing out on gains but never discussion on the consequences of a correction. It is not impossible as it has happened historically in Canada before and happened in the United States recently. Garth Turner has been beating the drums for years and is always told he is wrong "because it hasn't happened yet". Problem is if and when it does it will have a major impact on people's lives.

For me personally, I feel like I missed out on the massive real estate gains I could have seen over the past 10 years. I split $600 on a 2 bedroom rental apartment in Windsor at the time I graduated with my MBA in 2004. I was expecting a big salary, company car and corner office on Bay Street when I first entered the work world. My dream was a marketing job with Maple Leaf Sports & Entertainment and a downtown Toronto condo in the new Maple Leaf Square condo being built next to the ACC at the time. In a perfect world I would have met that special someone, allowed the condo to double in value and eventually used the profit to move back to Newmarket and raise a family. Instead I was convinced to move back home with my parents, pay off my debts and wait for my career to get established. For a few years I lived in Toronto where I enjoyed a social life in the city and ditched the daily commute to be within walking distance to Queen's Park where I was working. To run for office in Newmarket, I moved back home with my parents. This allowed me to fund my campaign, pay off debts, grow my business, invest something for retirement and save for a down payment for a place to live. I also chose to live with my parents because I love them and enjoy spending time with them while they are healthy and I have an opportunity to do so. It enhances my freedom, it does not limit it. Since 2008, I have been waiting for a housing correction out of fear that I will get burned if I buy now while at the same time being preparing to capitalize if an opportunity exists to buy low on a good deal. I believe the peak has to be near and similar to the fall in the dollar and oil, once we are aware of a decline in the GTA housing market it will almost be too late to react to it or reverse the spiral downward in the short term. An aging population looking to sell combined with fewer younger buyers able to afford could be the trigger that increases supply and balances the price downward to meet limited demand adjusting to economic fundamentals. It may also be an opportunity to have a second chance to benefit from some of the gains seen in real estate that I missed over the past ten years.

In June, both of my parents will be retired and are considering a move to Midland where they have roots and where family lives. This will force me to buy or rent in the near future. A strong argument could be made to move into Mississauga closer to work. It would cost $235,000 with $500 condo fees to buy or about $1600 to rent at Marilyn Monroe condos across from Square One. Living in Toronto also tends to have some advantages socially over Newmarket from the perspective of being single in a suburban family town. Having said that, Newmarket has been my home for 30 years and it is where I would like to live despite a long commute, less nightlife and a high cost of living. On realtor.ca no condos are currently for sale in Newmarket. $365,000 with $430 in condo fees gets a 1 bedroom condo near Aurora town hall. I have always liked the town houses next to Pickering College in Newmarket but currently there is one currently listed listed at over $600,000. That is way to high for my budget on a single income. On a positive note, there did seem to be plenty of rental options in Newmarket. My favourite was located at Main and Davis for $1800 per month. A basement apartment or apartment building range from $1100-$1700 to rent in town. The cost of living is high in Newmarket but right now to live here I think it is smarter to rent instead of buying at this point in time. A housing correction will hurt young people with low equity and high mortgages relative to the value of their asset. It will hurt those whose retirement plan is selling their house and little else. It will not hurt the renters missing out on profit as housing prices increase. These increases are not real unless you sell. A wise person once said it is better to have one bird in hand than two in the bush. For me there will be a time to buy, but that time is not now in Newmarket.